Designing the new money

Before a single statute is touched, the new money has to be designed — and the first discovery at the drafting table is that there is no perfect design, only a space of trade-offs in which every gain is paid for somewhere else. This is the part the loudest monetary reformers, on every side, tend to skip. The gold-standard advocate, the Bitcoin maximalist, the modern-monetary theorist, and the central-bank-digital currency designer each arrive certain that their single dial — hard supply, fixed issuance, sovereign spending, programmability — resolves the problem. Each is right about the dial they have grasped and wrong about the four they have let go slack. A currency constitution is the act of setting all the dials at once and owning the consequences of the whole configuration.

Six dials matter most. The anchor decides what disciplines the supply: a committee’s judgment, a legislated growth rule (Friedman’s k%), a commodity basket, or a link to real output. The injection point decides who receives new money first — the single most distributionally consequential choice in all of monetary design, because it is the Cantillon gradient made concrete (Lesson 13). Demurrage decides whether holding the unit idle carries a cost, the one lever that splits the medium of exchange from the store of value (Lesson 61). Programmability decides whether money can carry conditions — powerful for binding public spending, catastrophic if turned on private citizens. Privacy decides who can see whose transactions. Set these badly and you have built the surveillance coin that this curriculum treats as a control technology rather than a reform. Set them well and you have something genuinely new.

The asymmetry that does the real work

The single most important design move falls out of the instrument above the moment you try to maximize both individual freedom and capture-resistance: you cannot, unless you break the symmetry between the citizen and the state. A ledger transparent enough to expose the government’s every spent dollar is also transparent enough to expose the citizen’s every purchase; bearer-cash privacy that protects the citizen also hides the state. The resolution — and it is the conceptual core of this entire section — is asymmetry: radical transparency for public money, strong privacy for private money. Saule Omarova’s “People’s Ledger” and Robert Hockett’s public-finance work both circle this idea; most deployed CBDC designs invert it, surveilling citizens while leaving state spending as opaque as ever. The inversion is not a technical accident. It reflects who commissioned the designs.